More Evidence of Health Cost Constraints

Evidence of health cost contraints is showing up in more economic reports this week. The latest reports show slower growth for health insurance premiums and slow growth in prices for healthcare products and services.

The Kaiser Family Foundation’s annual survey of health benefit costs showed that the average health-inurance premium for working Americans rose by only 4% this year. That rate compares favorably to the 4.5% rate seen in 2012 and the 9.5% jump seen in 2011. Foundation President Drew Altman said:

We are in a prolonged period of moderation in premiums, which should create some breathing room for the private sector to try to reduce costs without cutting back benefits.

But he noted that out of pocket costs for employees are still growing, which leaves many people still worrying about how to pay their medical bills.

A report from the Altarum Institute found that healthcare prices grew only 1.1% in July compared to a year earlier. Commenting on their findings, the report’s authors said:

The 12-month moving average, at 1.6 percent, represents a new low for our data. We see very little likelihood of significantly higher healthcare prices in the near term.

No doubt, people will see what they want in these numbers, but it’s hard to deny that this is good news.

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